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Use of mobile payments soaring

Use of mobile payments soaring

Category: Banking

Updated: 15/03/2016
First Published: 09/02/2016

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Have you ever sent a payment using just a mobile phone number? If not, you could soon be one of the minority, with usage of the Paym mobile payment service nearly doubling every six months.

Rising popularity

New figures from Paym have revealed that the number of payments sent in the second half of 2015 stood at 1.46m, an increase of 89% from the 774,628 sent in the first six months of the year, highlighting the growing popularity of this form of payment. In fact, £146m has now been sent since Paym launched in April 2014, with the bulk of that being achieved in the final half of 2015.

The number of mobile phone numbers registered for Paym also continues to increase rapidly, with 624,420 people registering with their bank or building society in the second half of 2015. Overall, a total of 3.2 million people had registered for Paym with one of the 17 participating banks and building societies by the end of December 2015, with the vast majority of current accounts now able to offer this service.

Realising the benefits

The figures also noted a clear change in consumer behaviour, with the average transaction value of a Paym payment dipping below £50 for the first time in the last three months of 2015 (£49.48). This suggests a move towards using the service for smaller, everyday amounts, it said in a statement, arguably because people are catching onto the idea of using the service to pay back friends and family for those small, one-off expenses.

In fact, petrol money, splitting bills, paying for IOUs and covering other household costs continue to be some of the most popular reasons to use Paym, with almost a quarter of those surveyed saying they've used the service for one of these reasons. Meanwhile, contributing to a group present was the single most popular reason for making such a payment for the first time, but the popularity of using the service to pay a small business is also increasing, with 13% of users having paid a small business using their mobile number.

"More Paym payments were made in the last six months than the whole previous year, so it seems plenty of people have cottoned on to using their contacts for more than calls and texts," said Craig Tillotson, chairman of Paym. He added that, given the service is so simple – all you need is a mobile number to securely send payments to another bank account using your own banking app – it's no wonder the service is becoming more popular, so it could be time to get in on the action. Contact your bank to see how easy it is to get involved, and if your account doesn't offer such a service, it could be time to consider alternatives.

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

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